These short-term loans carry interest rates up to 4,200 percent plus fees, according to Allen.

In the US, nonbanking services like payday lenders, pawn shops and debt collectors, have become a core part in the Consumer Financial Protection Bureau's mission to help consumers.

Nearly 20 million Americans use payday loans, and many have allegedly failed to follow federal consumer protection laws. Earlier last month, the CFPB's director, Richard Cordray, announced a new arm of the agency to police such entities.

Consumer advocates in the UK are saying the government has failed to take similar steps, though some reputable UK surgeons are urging patients to bypass the loans.